By Michael D. Vairin, RA
Real Estate Expert
(Honolulu)–There are many who are speculating about the timing of a real estate purchase, either for your home or investment, especially given the last few years of a tough real estate market. Many ask me all the time, “Is it a good time to buy or sell real estate?”
Before a reasonable answer can be formed, there are a multitude of additional questions:
- What geographic region or market is of interest?
- Is your purchase or sale for your personal residence?
- What are the primary reasons for a purchase or sale?
Real estate is definitely cyclical, as history will show us and which many of us have experienced over the last few years. It is nearly impossible to time your sale or purchase to the peak of a market, so that is why it is critical to understand your needs. Everyone needs a place to live and our homes should be first and foremost to provide for our basic housing need. If our buying decision is primarily to make a home and raise a family, then likely you will stay in that home for a longer period of time. The longer we hold the more opportunity we have to withstand market fluctuations.
If you study the market fluctuations across the Country, you will find vast differences in market values over time. Many markets when graphed resemble a “bell shaped” curve, meaning steep increases and decreases. However, when you study real estate onOahu,Hawaii, you will find much more resiliency in fluctuations. The graph below dates back to 1987, nearly 25 years. It does not resemble a bell shaped curve but instead shows that real estate onOahu, is more resilient and stable as compared to other parts of the Country. This is not say that the market never looses value but it does say the loss is much more minimized and ultimately resumes to improved values.
The primary leading factor to this resiliency is the limited supply of land, not to mention the highly desirable climate. Once you have made the decision to purchase, then there are a series of additional questions with regard to what neighborhood best meets your needs. OnOahu, there are many neighborhoods to consider that have differing characteristics and which can meet your needs related to lifestyle, work location, schools and recreation.
So as usual, the answer is not as straight forward as we all would like, but generally speaking, now is a good time to be in real estate and depending on your market and circumstances, it could be a really great time.
These sometimes can be challenging to work through but there are plenty of resources to help you through the process. I strongly recommend that you first consider retaining a real estate agent who is well acquainted with your market area and has a professional work ethic to provide you with the best service to exceed your expectations.
I will be writing on a variety of real estate topics in the weeks and months ahead in such areas as financing, market trends, how to protect your investment, remodeling, maintenance and many more. I am always happy to help with your questions or needs, so please do not hesitate to contact me via email at MVairin@cbpacific.com.